GLOBAL TRENDS AND BUSINESS

HANDOUT 1
Before studying business around the world, it is essential to know what the general scenario is
across the globe. The trade or business depends on number of factors like political situation,
terror networks in the region, political instability, cordial relationship among nations, connectivity
etc. Therefore to know about the global trends is very important as this would have a direct
impact on the trade and business across the world.
About Asia the largest continent, has been sub-divided into five regions. West Asia, also called
as Middle East by the Western countries specially United States, Central Asia, South Asia, was
previously known as Indian Sub-Continent, South East Asia and East Asia.
Almost all the regions have remained disturbed due to some reason or the other. In West Asia,
Syria has been on fire since 2011. United States want the Dictator Assad, Shia, to be removed.
US is supported by its Allies like UK, France, Germany etc. On the other side are the President
‘Assad’s loyal Army consisting both Shia and Sunni, supported by Russia. The situation
becomes more complex when Islamic State also joins the fight supporting the Sunni rebels
group in Syria. Iraq, the oil producing country, is still not normal. Its northern parts are still
disturbed. In Yamen also Shia rebel groups are fighting against the Sunni groups in power. On 8
May, the US, under President Donald Trump, pulled out of the Iran nuclear deal. The deal, also
known as the Joint Comprehensive Plan of Action (JCPOA) is an agreement struck between
Tehran and the five permanent members of the United Nations Security Council and Germany
(P5+1) over the former’s alleged nuclear weapons programme. Since then, Iranian foreign
minister Javad Zarif has visited New Delhi to drum up support for its stance. All these factors
have a direct impact on trade with other countries.

The Central Asia is again an attractive area as it is full of natural resources. Most of the
countries once being part of then, USSR, has interested western countries a lot. Russia has gas
and oil pipelines drawn right when that area was part of USSR. China not remaining behind has
either laid the gas / oil pipelines or are laying. India has had very good relation with the region,
but unfortunately does not have any direct access to Central Asia. India is part of South Asia,
has only 2% trade with South Asian countries. This forces India to look elsewhere, specially
towards South-East Asian countries. This forces India to form sub regional groups. The South-
East Asia has attracted a number of countries because of trade. Based on this India’s Act East
Policy. East Asia which consists countries like Japan, both the Koreas, Taiwan has also
remained disturbed because of North Korea. Now with Trump and Kim agreeing to meet each
other, everyone is waiting for the outcome of the meeting.

In Europe there is a very strong Union Called as European Union which consists of 28
countries. Out of this Britain has decided to leave the Union by April 2019. India has very good
trading relations with EU and bilaterally also with most of the countries.

North America is very important to India. Canada. USA and Mexico are important trading
partners of India. USA wants to dictate the whole world. With Donald Trump the things have
become quite unpredictable. USA is very important strategic partner of India. Through India it
wants to counter China which is rising and has the fastest growing economy. South America is
also quite important specially the oil producing Venezuela.
African countries are also important to India for investment purpose. India and Japan are jointly
trying to develop trade route to Africa so as counter the China’s OBOR.

Australia, another important trading and strategic partner of India. Australia, Japan, USA and
India are countering China’s dominance in Indian Ocean. If June first week was all about the
Indo-Pacific, Delhi’s diplomatic focus second week June was on Eurasia. In his keynote address
to the Shangri La Dialogue (SLD) in Singapore, Prime Minister Narendra Modi had articulated
India’s geopolitical conception of the Indo-Pacific. India has become a full member of the
Shanghai Cooperation Organisation (SCO) organisation in Qingdao, China. Prime Minister
Narendra Modi on 10th June sought increased economic links and integration among the
Shanghai Cooperation Organisation (SCO) security bloc but also underlined the need for a
respect for sovereignty and transparency in connectivity projects among the members of the
grouping. He pointed out that connectivity was key to economic development of the region.
That there is structural tension between these multiple imperatives should not come as a
surprise. Great power relations have entered a turbulent phase in recent years. For nearly two
and a half decades after the end of the Cold War, America, Europe, Russia, China and Japan
all sought to deepen economic cooperation and expand political cooperation with each other.
This is a very different world than what we have known. Delhi needs to be quite nimble- footed
in coping with the new dynamic among the major powers. It must also deal with the competing
geopolitical frameworks in play. If the Indo-Pacific is a maritime conception, Eurasia is a
continental one. The obsession of the commentarial with the Quad and its presumed symbolism
misses the fact that India’s engagement with the US and Japan (the triad) has steadily
advanced through this decade. Meanwhile, India continues to sit with the Russians and Chinese
in a trilateral forum as well as the BRICS with Brazil and South Africa.

Originally, “Eurasia” is a geographical notion: in this sense, it is simply the biggest continent; the
combined landmass of Europe and Asia. However, geopolitically, the word has several different
meanings, reflecting the specific geopolitical interests of each nation.  How America "manages"
Eurasia is critical. A power that dominates “Eurasia” would control two of the world’s three most
advanced and economically productive regions. A mere glance at the map also suggests that
control over “Eurasia” would almost automatically entail Africa’s subordination, rendering the
Western Hemisphere and Oceania geopolitically peripheral to the world’s central continent.
About 75 per cent of the world’s people live in “Eurasia”, and most of the world’s physical wealth
is there as well, both in its enterprises and underneath its soil. “Eurasia” accounts for about
three-fourths of the world’s known energy resources.
Most of India’s trade, investment, technology and cultural ties are currently with the maritime
powers. It is in the Western world, especially in the Anglo-Saxon states, that the Indian diaspora
has flourished. The US and the European powers are also increasingly important security
partners for India. When you combine this with India’s natural maritime advantages, the Indo-
Pacific comes into bold relief. The continental construct, in contrast, is about managing India’s
intractable problems. Unresolved territorial disputes with China and Pakistan have resulted inthe
militarisation of its northern borders and blocked India’s access to the inner Asian space. Those
problems are not going to disappear any time soon.